NY -- Standard&Poor's CreditWire 7/23/97 -- Following the announcement by B.A.T. Industries Plc (BAT) to acquire control of the Mexican cigarette manufacturer Cigarerra La Moderna (CLM) which is part of Empresas La Moderna for $1.7 billion, BAT remains on CreditWatch with negative implications, where it was placed April 17, 1997 (see list below). The largely debt financed acquisition limits BAT's financial flexibility at current rating levels and weakens the underlying rating in advance of possible tobacco settlement and related payments. Over the near term, the group's 1996 pro forma for the acquisition earnings before interest, taxes, depreciation, and amortization (EBITDA) to interest declines to about 9 times (x) from above 11x in fiscal 1996 and its pro forma
